Merv’s Weekly Uranium Review
for week ending 13 February 2009
Merv’s Daily Uranium Index
Market Data for Friday 13 Feb 2009
Open: 140.07
Hugh: 144.51
Low: 136.36
Close: 141.86
Volume: 4496
Note that the volume is an average volume of round lot sales for the 50 component stocks. For total volume, multiply by 5000.
It wasn’t much of a week for the uranium stocks. The Weekly Index barely moved and the weekly advances and declines were no great shakes either.
Before getting into the normal analysis there is one thing about the Index action that may be interesting to note. We have had the Index (both Daily and Weekly) consolidate at a bottom for a while, then spurt upwards breaking through a resistance level and then halting only to move sideways again. I have been seeing this kind of action on many, many of the 160 gold and silver stocks that I follow every week in my Precious Metals Central service (see link on the left of the page, lower down). What has been happening over and over again on a whole lot of these stocks is that they break above that second consolidation resistance level and end up zooming 100% or more in a short space of time. I would expect that this is what will be happening to the uranium stocks once they decide to move. As an aside, I provide my Precious Metals Central subscribers each week a table of the top 25 performing stocks in each of the three time categories, 15 day, 50 day and 200 day. The AVERAGE performance of these top 25 stocks in this week’s tables are 61% for past 15 days, 214% for past 50 days and 25% for the past 200 days during which most stocks were still on the down trend. When these stocks (and uranium stocks should be no different) break out they really move. I will try and post a few stock charts during the coming week of those that either are in early break-out stage or just about to break out.
The Merv’s Daily Uranium Index closed on Friday on the up side again, but only a little on the up side, again. The Index closed higher by 0.93 points or 0.66%. There were 27 winners, 18 losers and 5 stocks going nowhere. Of the five largest stocks by market value, Cameco lost 2.4%, Paladin lost 1.9%, Uranium One lost 5.4%, Uranium Participation gained 7.5% and USEC gained 1.9%. The best daily winner was Powertech Uranium with a gain of 12.8% while the loser of the day was Uranium Power with a loss of 11.8%.
For the week as a whole the Merv’s Weekly Uranium Index closed higher by 33.58 points or 0.91%. There were 23 weekly winners, 22 losers and 5 unchanged. I think that is the most weekly unchanged for some time. As for those five largest stocks, Cameco lost 4.0% on the week, Paladin gained 1.2%, Uranium One gained 5.0%, Uranium Participation lost 1.0% and USEC gained 7.3%. The best weekly gainer was Quaterra with a gain of 38.2% while the loser of the week was Strateco with a loss of 20.8%.
Looking at the long term we see that the Weekly Index is now above its long term moving average line while the line slope is still to the down side. If we go over to the Daily Index the Index is still below its negative long term moving average line. The daily information is usually more accurate than the weekly because it averages out all days of activity not just the final Friday data. The momentum in each case is still in its negative zone although above its positive trigger line. All in all I would still rate the long term as BEARISH but getting close to being upgraded in rating.
On the intermediate term the Daily Index continues to trade above its positive moving average line. The momentum indicator remains in its negative zone just below its neutral line. It is above its positive sloping trigger line. As the Daily chart shows, the volume indicator is going gang busters on the up side which is a very good sign, looking forward. On the intermediate term the rating remains BULLISH.
Short term wise nothing has changed over the past few days. The Index remains just above its positive moving average line and the momentum indicator remains in its positive zone above its positive sloping trigger line. As for the daily trading volume, it leaves a lot to be desired. The daily volume continues to be below its 15 day average volume and therefore pulling the average volume value lower and lower, but still the daily volume is below this. It needs to perk up for a good move to start. In the mean time the short term rating remains BULLISH.
As for the direction of least resistance, that should be no surprise. That would continue to be in the lateral direction until the Index perks up either up or down.
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